Sugar Tax: Who is affected and how to register?

By November 23, 2021No Comments

The sugar tax was introduced by the government of the United Kingdom to tackle the issue of obesity in children and youth that has been causing major health issues.

As per the HMRC regulations, businesses that produce, package, or bring sugary drinks to the United Kingdom will be impacted by the sugar tax. The drinks are considered liable if they contain an added amount of 5 grams of sugar per 100ml of the drink after preparation. The 5 grams of sugar means the added amount of natural and artificial sugars.

All the big businesses that produce over one million liters of drinks under their brand or produce it for someone else will have to register to HMRC and keep a detailed record of all the production.

Who should register?

It is important to know that if you are not a small business if you produce your liable drinks under your brand or produce liable drinks under any other brand. It means that your business must register for the sugar tax under HMRC. You must also register for the tax if you package bottles, or can be liable for drinks for another brand.

You may also have to register for the tax if:

  • You bring the liable and levy drinks to the United Kingdom.
  • You bring in the levy drinks from Channel Islands and EU.
  • You get your liable drinks packaged from a company that is not in the United Kingdom and then bring the drinks to the UK.

Who is a small producer?

You are a small business if you produce less than one million liters of sugar drinks in the past year or if you will not produce more than one million liters of the liable drinks in the following 30 days. You do not have to register to HMRC for the tax if you are a small producer.

If you have someone else package your liable drinks then you can register for your packager. If you register for your chargeable drinks then the packager will not have to pay your levy.

When to Register?

The registration depends on when and how you handle the liable drinks. You can register within a month of:

  • Packaging the chargeable drinks.
  • The known date on which the next packaging is to be done (in the next thirty days).

What do you need for registration?

You will need the following things to register to HMRC:

  • Postcode and UTR (Unique Taxpayer Reference) for your business.
  • Addresses of your nominated warehouses in the UK for registration.
  • Your production amount of last 12 months in liters.
  • The liters of liable drinks of your brand that you may package in the coming 12 months.
  • The amount in liters that you may package for someone else in the next 12 months.
  • A government gateway ID and password are required if you are liable for the registration of the sugar tax HMRC. You can create a user ID when you start your business.